From political rallies to university seminars, it is becoming fashionable to say that globalisation has led to stagnant living standards for working and middle classes of the developed world, leaving national governments powerless to deliver rising incomes and explaining rising political dissatisfaction with the status quo.

But these are dangerous words in such simple form, because they are both wrong and getting at something. Living standards in Britain and in many developed countries have seen phases of being squeezed. But we should beware concluding that responsibility for that rests entirely with a faceless force called globalisation—that if we reversed would put right all that is wrong with the world.

This question is not new. But the recent British decision to leave the European Union, the prominent place for trade policy in the end game of the current US presidential cycle and phoney war phase of national elections in France and Germany, means the issue has not just risen up the agenda—it is becoming the agenda in much of the developed world.

The debate across the west

Crucially this is a debate in flux—and where it settles will matter for our politics and economics for decades to come. In the face of popular frustration progressives are rethinking where they stand on questions from trade to migration. In the US a Democrat President is pushing trade deals that cross both the Pacific and Atlantic, amidst a growing

Comments

Alyson K

September 20, 2016 at 12:18

Just wondering about the inequality of income and increasing divide between haves and have nots, and wondering if there is actually less money in circulation despite the credit boom, as the very rich take their money out of circulation and hide it in off shore accounts. Credit rates vary and those who can least afford it pay the most, so the poor keep the banks and loan companies going, but debt is the mechanism of wealth exchange now. More goes to the rich and comes from the poor. Low wages mean the government pays to bring up incomes, to ensure people have enough to eat after working a full time job, which means that the government subsidises companies which pay massive dividends to their highest paid executives and owners, and also gives tax breaks to these same companies so that they do not contribute back into the country. Please correct me if I'm wrong. It just looks as though debt should be eradicated, the rich should pay the same proportion of tax as the poor, and investment in social infrastructure should have at least the same priority as subsidising private corporations. That way the wealth already in off-shore accounts can be disregarded as money not in circulation and countries can invest in developing raw materials into goods which currently are cheaper from countries where wages and life expectancy is lower. The rich are worrying about a possible future socialist government extricating some of their wealth away from them to invest in a fairer society. Maybe that anxiety could be alleviated without further punishing the low paid and the destitute. I don't know, but the country knows that Austerity was a political con trick as their privations were not used to reduce the deficit but to line the pockets of individuals without social consciences. Democracy respects differences in perspective and voting allows peaceful change to take place within a stable legislative framework.

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